Edited by: Muhammad Haris
Last updated time: 06 March 2023, 16:46 IST
As per SEBI MF regulations, no mutual fund can provide returns.
According to Sebi, illustrations in advertisements, presentations, brochures and pamphlets appear to provide investors with a steady return on their investment.
The Securities and Exchange Board of India (Sebi) has asked mutual fund houses to stop misleading advertisements, brochures and presentations and said that illustrations in advertisements, presentations, brochures and brochures appear to assure investors of their fixed income. investments.
“It has been observed that certain asset management companies are using practices in relation to advertisements which are not in compliance with the Code of Advertisements laid down in the SEBI (Investment Funds) Rules, 1996,” Sebi said.
The regulator has come across cases where some MFs have distributed brochures and pamphlets depicting future returns based on projections and projections. He also said there are fine print disclaimers and assumptions that investors might miss.
“Such disclosures/advertisements are ambiguous and may be misunderstood by investors and do not conform to the letter and spirit of the provisions of the Sixth Schedule to the SEBI (Investment Funds) Rules, 1996,” Sebi said.
As per SEBI MF regulations, no mutual fund can provide returns. As all mutual funds invest money in equity and debt markets, NAVs are subject to market ups and downs. In this case, the prospective return does not make sense.
Sebi has also asked mutual fund houses to desist from such activities in future and remove such advertisements/presentations/booklets and brochures from all media and advise their distributors not to use such advertisements/presentations/booklets and brochures.
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